Volume 3—June 2010

SAVE THE DATE! ISD/FPDA Joint Industry

Summit October 5‐8, 2010 The PGA National Resort & Spa

West Palm Beach, Florida

The dates are set!

The program is finalized!

The best networking

opportunities of the year await

you!

Plan to participate!

More details available on page

5 of this newsletter.

For more information of the PGA National Resort, click here.

A Message From FPDA President Richard Neels Dear Fellow FPDA members, This is somewhat of a “good news / bad news / good news” article. Trust me, I’d like to lead off with a “triple good news” first sentence, but it’s pretty difficult with daily images from the Gulf of Mexico. More on that in a bit. First, I’d like to begin with a comment or two about our industry and the economy. If you

have been reviewing our monthly economic indicator report prepared by Cleveland

Research, you may have noticed that the needle is moving in the right direction, as FPDA

members have reported increased sales, inventory, and orders for a number of months

now.

The May survey results showed continued sales acceleration (up 25%), and is the sixth consecutive month to show an increase. In addition, MRO activity increased in April, which points to underlying manufacturer activity and increased equipment utilization. So we’re likely seeing “true” numbers, and not just the temporary benefits of general inventory restock. Despite an improved outlook, fluid power distributors and manufacturers remain cautious

due to the short‐term nature of incoming orders, and a still fragile economic

environment. And that leads me to the bad news…

“The professional network for

fluid power, automation and

motion technology providers

dedicated to significantly

enhancing member and channel

performance by delivering

indispensable networking,

education and success

strategies.”

INSIDE THIS ISSUE:

A Word from Richard Neels, FPDA President Page 1

FPDA Compensation Survey Released Page 3

FPDA/ISD Joint Industry Summit: Better Together ‐ Teaming for Success Page 6

Latest News on the FPDA M+CSP Certification Page 8

Sales Assessment Tools from Profiles International Page 4

Top 10 Customer Services Mistakes, Nancy Friedman Page 12

New ISS Small Parcel Shipping Program Will Save FPDA Members $$$ Page 10

New Regulations in Effect for Posting Employee Labor Laws Page 11

(Continued on next page)

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A Message From FPDA President Richard Neels (continued) FPDA BOARD OF DIRECTORS EXECUTIVE COMMITTEE

President & Chairman of the Board Richard Neels Hydraquip Distribution, Houston, TX Immediate Past President John Thornton GS Hydraulics, Inc. , New Berlin, WI President Elect Steve Schwasnick Western Integrated Technologies, Bellevue, WA Vice President of External Affairs & Membership Bill Gillies Behco Inc., Division of H&P Technologies, Farmington Hills, MI Vice President of Finance ‐ Treasurer Mike Hamsey, Jr. R.M. Wright Co., Farmington Hills, MI Executive Committee Member at Large Karl Anderson TECO Pneumatic, Inc., Pleasanton, CA Convention Chair Hal Kemp Allen‐Orton LLC , Norcross, GA Young Executives Chairperson Alex Wheelock Connector Specialists, St. Rose, LA

DIRECTORS

Thomas E. Price, Jr., Price Engineering Co., Inc. John Evans, Nott Company Jerry Herrin, Wilson Company Doug Cameron, Kaman Industrial Technologies Rich Freeh, RG Group Steven Jenkins, Applied Industrial Technologies Greg Sidener, Sidener Engineering Jim Slone, SunSource Patricia A. Lilly , FPDA Executive Director

Nicole Tierney Weber, Editor nweber@fpda.org

LEGAL COUNSEL

Bruce J. Kasten, Esq., Duane Morris, LLP, Philadelphia, PA

FPDA Office 105 Eastern Avenue, Suite 104

Annapolis, Maryland 21403‐3300 410‐940‐6347

We’ve all seen the images from the Gulf, and they’re shocking and heartbreaking. The first thought that pops into my mind is one of sorrow for the lives lost, and the lives (and livelihoods) that are adversely affected by this tragedy. We do not yet know how wide‐spread the damage will be, or when the leak will finally be fully stopped. But one thing is clear – while the environmental impact is almost incalculable, the economic impact will be measured in the billions. How this will affect many industries (including our own) is un‐known – many of us have ties to the oil industry. Will this nega‐tively affect us? Perhaps it will. But on the other side of that is the fact that many FPDA members will, to some degree, likely be needed in the cleanup effort that is to come. There’s really no way to predict what will happen ‐ the best we can do as a country (and a world) is clean it up, and move forward, hopefully learning our lessons and doing things better. Ok, enough bad news – let’s end this article on a positive note with some exciting happenings at the FPDA:

FPDA will be hosting an Energy Savings & Sustainability focus group meeting in July. The spotlight will be on energy savings, sustainability, and increased profits. The work of this group will be a featured segment of the FPDA/ISD Joint Summit, Oc‐tober 5‐8 at the PGA National Resort in Palm Beach Gardens, Florida (watch your mail for full details soon.)

FPDA has published its bi‐annual Compensation Report, which is culled from Profit Planning Group’s Employee Compensation Study of the distribution industry (more than 1,100 firms). This Excel report compares FPDA results with the results of all par‐ticipants, and further divides firms into categories of 20 sales volumes and over 100 geographic areas. This data is ex‐tremely helpful in benchmarking your compensation/benefits packages, and if you would like to purchase a copy, just con‐tact info@fpda.org

Lastly, the encouraging numbers I posted earlier were the re‐sult of the surveys from the Monthly Economic Indicator Re‐port. The more members participating, the more accurate the reports. So I encourage everyone to participate. Please con‐tact info@fpda.org for details.

Thanks for reading, and to keep abreast of further developments, be sure to read your monthly FPDA Express electronic bulletin, or check out the FPDA website at www.fpda.org.

Sincerely, \ FPDA President

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This year, 77 FPDA Distributors participated in the 2010 Employee Compensation Survey prepared by Profit Planning Group. This 2010 study presents the results of PPG’s Employee Compensation Study of the distribution industry. It analyzes the data submitted

by 1,176 U.S. firms for over 7,000 locations. FPDA co‐sponsored this study along with 30 other distribution organizations. Hiring and keeping good employees is essential to the profitability of your business, especially in today’s economy. To achieve that goal, you must consider your overall employee compensation plan ‐ not just your pay scales, but your benefits program as well ‐ in comparison to other firms in distribution. You can learn how your firm’s employee compensation package stacks up in the industry by utilizing the 2010 Compensa‐tion Study.

There are two reports which represent the final study:

Volume 1: FPDA 2010 Employee Compensation Report (20 pages) This volume includes an executive compensation overview; summary of executive compensation, summary of employee com‐pensation; detailed statistics on executive compensation; employee compensation, (outside sales staff, inside sales staff, and employee benefits.) This detailed report presents the analysis of participating FPDA firms. Volume 2: Industry Report (Excel Report) This report presents the analysis of all participating firms. Firms were categories into over 20 sales volumes and over 100 geo‐graphic areas.

These reports have been shared with participants and are now available to non‐participants and non‐members. The pricing is as fol‐lows: To purchase only one of the volumes: Volume I: $150 (member price) Volume II: $250 (member price) Volume I: $225 (non‐member price) Volume II: $325 (non‐member price) To purchase both volumes: Set (I & II): $300 (member price) Set (I & II): $475 (non‐member price)

If you are interested in purchasing these, you may do so at www.fpda.org, or contact FPDA at 410‐940‐6347.

2010 COMPENSATION REPORT RELEASED AND AVAILABLE FOR PURCHASE

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BETTER TOGETHER: Teaming for Success!

FPDA and ISD have joined forces to produce a meeting like no other, this October 5‐8, at

the renowned PGA National Resort in West Palm Beach, Florida. Developed for fluid power, motion control, automation and sealing professionals, you

will discover the keys to success at the FPDA/ISD Joint Industry Summit. Better Together: Teaming for Success is more than a theme – it is the cornerstone for a profitable future.

As an attendee, you will:

Delve into content‐rich education packed with the latest in sales, marketing, and pricing strategies.

Double your networking through alignment with potential new marketing partners representing affiliated industries.

Hear the most up‐to‐date economic research framed to help support your future business decisions.

Explore new products, solutions and services at the Supplier Showcase.

Network with your peers to uncover the latest best practices in your industry.

The program will feature not only leaders in industrial distribution education, but networking features designed to add impact for you and your company. Here are some programming highlights:

Tuesday, October 5 – Play a little golf on one of the premier courses at the PGA National, while making acquaintance with your

fellow members and your new contacts from the International Sealing Distribution Association.

Wednesday, October 6 – This day will offer a spotlight on business strategies and solutions! Kick off the day with economist

Dr. Bill Conerly and learn what the recovery means for industrial distribution. Then, spend the morning and early afternoon partici‐pating in two out of six workshops, featuring the best and brightest of the University of Industrial Distribution faculty – take a look at these topics!

Structure and Staffing for Branch and Operations Managers

How to Improve Any Sales Force

Pricing Strategies

Product Profitability: Sell it‐Source it‐ Ship it

How to Increase Your Team's Competitive Selling Advantage

Marketing Strategies Then join your colleagues for a networking exchange focused on business strategies and solutions. Facilitated by one of the UID faculty members, this will be an interactive, lively session designed to provide you with nuggets of information to help you lead your business.

Connecting Professionals. Integrating Technologies. Page 7

The power of technology and the demands of technology are bringing us together as never before. On Thursday, October 7, FPDA and ISD members will benefit from a morning program devoted to fluid power and sealing technologies AND programs with a fo‐cus on energy savings and sustainability. What are the solutions to help manage energy resources in a way that brings meaningful value to you and your customer’s busi‐ness? What new opportunities are created and how do we optimize profits? How do we sell energy savings and sustainability? Join your peers in exploring the vast opportunities on the horizon. In the afternoon, participate in the Supplier Showcase, which will bring much of the learning, networking and discussion that tradi‐tionally take place inside conference rooms right to the FPDA/ISD Joint Industry Summit. This showcase for fluid power and seal‐ing manufacturers will surely open your eyes to new products and solutions. On Friday, October 8, you can head back home after hearing Tom Reilly share his winning thoughts on the Value Added Corpora‐tion. Join Tom as he helps you incorporate all you learned this week and inspires you to share your knowledge with your team. Not only will you find the program packed with information you can use in your business, but the evenings have also been de‐signed to help you build and cement your business relationships. Watch your mail for program details, but we guarantee this is a meeting you will not want to miss!

Continued from page 8

GET READY FOR THE M+CSP CERTIFICATION! As you know, FPDA has been carefully and methodically planning its M+CSP Certification over the past few months. Here’s a quick summary of where we stand right now:

FPDA is moving forward with an exam that covers 6 technologies plus 2 sections on sales skills. FPDA will provide extensive feedback to managers on results of the tests, to include scores by sec‐

tion so managers can understand strengths and areas needing development for their employ‐ees. This program should be used as a key staff development tool for managers.

The test will have 95 questions; a 2 hour time window for candidates to complete the test is recom‐mended.

The passing score has been determined. Pilot participants have completed their tests and will be notified shortly if they passed the certification exam. It was noted by the FPDA task force working on the certification that many pilot participants took the test “cold” without extensive preparation; however, the task force felt it was important to keep the bar high and determine programmatic im‐provements to support achievement of that bar for the M+CSP, rather than lowering the bar to en‐sure a higher passing rate for pilot participants.

The task force will look at completing a study guide which at a minimum, directs participants to relevant materials for each section, and at best, provides a comprehensive resource that can be used during the test.

After finalizing all remaining details, the Certification will soon be unveiled to a wider audience. We hope

that FPDA members and others will find this offering of great value and a great management tool for pro‐

fessional development.

Do You Have Some Exciting

Company News That You Would Like To Share?

Please send it in to the FPDA Office to be included in the next FPDA Newsletter!

You can email news and updates to nweber@fpda.org.

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NEW PROGRAM FOR FPDA MEMBERS!

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contractor with a subcontract value of more than $10,000. The Rule does not apply to any contract resulting from solicitations issued before June 21, 2010. Every covered contract must include a contract clause requiring that the contractor post the employee notice during the term of the contract in accordance with the requirements in the Rule. The contracting agency is responsible for including the contract clause in the contract with the prime contractor. The prime contractor is responsible for including the contract clause in its con‐tract with a covered subcontractor. The clause may be incorporated into a contract by reference to 29 CFR Part 471, Appendix A to Subpart A. Contractors and Subcontractors Required to Post Employee Notice Physical Posting – A contractor or subcontractor that posts notices to employees physically in the workplace must also post the employee notice physically. Where a significant portion of the workforce fulfill‐ing the contract is not proficient in English, the employee notice must be provided in the language employees speak. The employee notice must be placed in conspicuous places in the workplace so the notice is readily seen by the employees engaged in activities relating to the performance of the contract. Electronic Posting – A contractor or subcontractor that customarily posts notices to employees electronically must also post the employee notice electronically. The contractor may use a link to the Labor De‐partment website that contains the full text of the notice, provided the link reads in the employees’ spoken language: “Important Notice about Employee Rights to Organize and Bargain Collectively with Their Employers.” The Labor Department website provides translation of the notice text. Enforcement of the Rule The Labor Department’s Office of Federal Contract Compliance Pro‐grams is authorized to conduct compliance reviews to determine if a contractor or subcontractor is in compliance with the Rule or other laws, Executive Orders or regulations enforced by the Labor Depart‐ment. Employees may also file complaints claiming that the contractor or subcontractor has not complied with the Rule. In case of a viola‐tion, conciliation and administrative enforcement proceedings will follow. Sanctions for a violation include cancellation of the contract, or debarment of the contractor with one, several, or all Federal agen‐cies.

Jade West, NAW Senior Vice President‐Government Relations Federal Contractors and Subcontractors Required to Post Employee Notice of Labor Law Rights The Labor Department has issued its final rule requiring certain federal contractors and their subcontractors to post a notice informing employees of their rights as employees under the National Labor Relations Act to join a union. (75 Fed.Reg. 28368, May 20, 2010). The final rule may be viewed at http://edocket.access.gpo.gov/2010/pdf/2010‐11639.pdf (“Rule”). Wholesaler‐distributors who are Fed‐eral contractors or subcontractors are covered by this Rule. The “employee notice” may be viewed at:http://www.dol.gov/olms/regs/compliance/EmployeeRightsPoster2page_Final.pdf The Rule went into effect on June 21, 2010. The Rule implements Executive Order 13496 signed by the President on January 30, 2009, which included sanctions, penalties (including debarment) and remedies that can be imposed if a covered Federal contractor or subcontractor fails to comply with the employee notice requirements. In September 2009, NAW and numerous other organiza‐tions provided comments to the Labor Department that criticized the proposed employee notice as an inaccurate and incomplete overview of employee rights under Federal labor laws, and for suggesting that such laws favor a collec‐tive bargaining environment. For the most part, public comments did not alter the tone or content of the final version of the Rule, reflecting the strong union bias of the Administration. Prime Contractors and Subcontractors Subject to the Rule The Rule applies to any prime contractor with a Federal government contract of $100,000 or more. A contract for an indefinite quantity is covered unless the contractor or the contracting agency reasonably believes that total amount in any year will be below the $100,000 threshold. The dollar threshold set by the Rule is the simplified acqui‐sition threshold set in the Office of Federal Procurement Policy Act—which is currently $100,000. The Rule also ap‐

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"What are the best customer service tips?" is a common request we get. Recently someone asked us about the worst customer service mistakes? So, to make it even, we've compiled the ten worst customer service mistakes. Take note and don't let these happen to you!

Not Being Friendly Enough Without exception, not being friendly is the number one customer service mistake. Customers should be treated as welcomed guests when they call or visit your company. As we've all experienced, sometimes we're treated as an annoyance or an interruption. The Telephone Doctor motto: "Be friendly before you know who it is" is one way to eliminate this mistake.

Poor Eye Contact Heads that twirl on a spindle when you're working with a customer is a big mistake. Keep your eyes on the customer. It's a sure sign the person you're talking with isn't holding your interest when you're glancing all around. And they'll notice it quickly. Obviously, Telephone Doctor understands making good eye contact on the phone is a bit difficult, albeit impossible. Therefore, when you're on the phone you need to be completely focused on the call and the customer. Don't type, unless it pertains to the call, don't read something else, and don't do anything but listen to the caller.

Talking with Co‐workers and Ignoring or Not Acknowledging the Customer This customer service mistake unfortunately happens a lot. Seems as though it's more important to continue talking with a co‐worker than establishing immediate rapport with the customer. Drop the internal conversation as soon as you see the customer. Carrying on a conversation with someone in your office while you're talking with a customer on the phone is a real no‐no!

Being Rude No one thinks they're rude; certainly not on purpose. However, the customer can perceive many things you do as rude. And as they say, "Perception is reality." What's rude? Interrupting the customer, not listening to their concerns, talking on your cell phone when trying to help them, not sounding happy, chewing in the customers face or on the phone. This is just the start of a long list of 'rudes.'

Poor Product Knowledge

TOP TEN Customer Service Mistakes By Nancy Friedman, The Telephone Doctor

If you're not familiar with the products and services you offer, it's going to be very frustrating to the customer. Take the time to learn about your company. Know what's going on. If you're temporary or are new with the company, that shouldn't be used as an excuse. Customers don't care if you're new, working on a

temporary assignment or if it's not your department. All they want is help and information. Ask to be trained. Ask for more information from your company. Telling a customer, "I'm new" or "I'm just a temp" only adds fuel to the fire. You can explain that you will find someone to help them as you are "not familiar" with the situation. That at least shows you're going to help them. Leaving a Customer Without Telling Them Where You're Going and Why It's a very good idea to explain to your customer, in person or on the phone, what you're going to be doing for them. It helps them a lot and gives them a lot of patience. If you need to "go to the back" to get something it's easy to say, "Mr. Jones, the widget you're looking for is in the stock room. Let me go get it for you. I'll be a few moments." The same procedure should apply on the phone. Never tell the caller, "Hold on." Let the caller know where you are going and approximately how long you think you'll be. This will make working with the customer easier for both them and you. Blaming, accusing and complaining

It's not the person you blame that will look bad . . . it's you. Don't blame (or knock) the company, its policy or any member of the staff. Customers don't want to hear about whose fault it is, they just want the situation fixed. Take full responsibility of the situation on hand. Don't blame, accuse or complain.

Not Double‐Checking

When a customer wants something and it's not available, it's how you reject them that's more important than the fact that you are rejecting them. The process of double‐checking should become habit forming. It should be a standard operating procedure. It feels so good when you tell someone, "The last time I checked we were out of stock, but let me DOUBLE‐CHECK for you to be sure." I personally can think of dozens of times when I asked the person to double‐check after they told me they were out of things and what do you know . . . someone had reordered and the person didn't know about it. It's a big mistake to not double‐check.

One‐Word Answers

We're taught in school that three words make a sentence. Don't answer with one word. Even yes, no and OK are perceived as rude and uncaring. A Telephone Doctor reminder ‐ use complete sentences for your customer.

Head Shaking When a customer asks you for something, give them a verbal answer. Shaking your head up and down or back and forth is NOT an appropriate answer. They can't hear your head rattle.

Fixing these customer service mistakes will enhance your ability to work better with customers. Remember, it's the SLD's (subtle little differences) that make the big difference.

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